MILAN (Reuters) - An Italian court is expected to decide this week on a request by Telecom Italia's (TIM) top investor Vivendi to annul the former phone monopoly's decision to sell its landline grid to a consortium led by KKR, a source close to the matter said.

Vivendi, which holds 24% of TIM, filed a complaint with a Milan court in December 2023 challenging the sale, worth up to 22 billion euros ($22.4 billion).

Under Italian rules, a non-binding deadline for the court to decide on the case expired at the start of this week.

Sponsored by Italy's conservative government, which bought 16% of the network as part of the deal, the KKR sale helped to cut debt and stabilise TIM's finances.

Vivendi has criticised the deal, seeking a higher price tag, and questioning the sustainability of the business left behind.

Vivendi says the decision should have gone through an extraordinary shareholder vote, and not just the board.

The sale changed the nature of TIM's business and dissenting shareholders should have had the right to withdraw, by selling their shares back to the company, Vivendi has said.

TIM has said its board acted within its rights. The deal closed in July.

After a round of fruitless talks with Rome over TIM's future, the Paris-listed group took a back seat as an investor and in January 2023 withdrew its representative on TIM's board.

Vivendi no longer considers the TIM holding as strategic and is open to a potential sale of its stake, which is currently worth 930 million euros.

The file has drawn interest from private equity firms, including CVC, according to people familiar with the matter. Vivendi is looking for a price of between 1.0-1.5 billion euros, according to two of the sources. Vivendi declined to comment.

However, any transaction needs support from the Italian government, which has powers to greenlight any sale of more than 3% of TIM.

(Reporting by Elvira Pollina; Additional reporting by Mathieu Rosemain in Paris; Editing by Valentina Za)